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Anonymous whistleblowers may not always be ill-intentioned (The Hindu)

Mains Paper 3 : Economy
Prelims level : MCX case
Mains level : Stats of Whistleblower protection laws in India

Context:

• The Securities Exchange Board of India (SEBI) has informed the public that it will henceforth entertain complaints against market participants only if the whistleblower is reachable to substantiate allegations and provides supporting documents.
• It has also said that complaints made to it must be from an identified source.
• One understands SEBI’s angst in the MCX case, where after making allegations about funds diversion and other unfair practices, the complainant stonewalled all efforts to reach out to him by providing fake contact details.

Key highlights:

• The case highlights how frivolous whistleblowing can not only waste the regulator’s investigative capacity and time, but also inflict damage on investors by facilitating stock price manipulation by unscrupulous elements.
• But if anonymous whistleblowing provides a potent platform for disgruntled employees or competitors to undermine a genuine business, it has also set Indian regulators on the trail of many corporate misdoings in the past.
• The NSE co-location controversy and the related party lending at ICICI Bank came to light after such complaints.
• Therefore, while SEBI or other regulators may be right in insisting that whistleblowers remain accessible, it would be unfair to summarily dismiss anonymous complaints per se.

Whistleblower protection laws in India:

• Whistleblower protection laws in India are at a nascent stage.
• The omnibus law, supposed to ensure immunity for complainants who act in public interest, remains in limbo after the amended Whistleblowers Protection Bill of 2015 was never operationalised.
• For corporate, the amended Companies Act of 2013 requires all listed companies dealing with public money to establish a vigil mechanism, but stops short of specifying any timeline by which such complaints must be resolved.
• SEBI’s listing obligations and disclosure regulations require audit committees to vet such complaints, but again leave the procedure open-ended.
• Under extant laws, whistleblower complaints about companies are supposed to be first escalated to company boards and internal audit committees.
• But these are manned by independent directors, who are often known to be complicit with the management and wary of rocking the boat.
• In such circumstances, corporate insiders filing complaints stand a real chance of being both ignored and victimised.
• This legal ambiguity about the status of whistleblowers makes anonymous complaints the default choice even for bona fide insiders looking to expose corporate malpractices.

Way ahead:

• If SEBI is keen to weed out malicious complaints masquerading as whistle blowing.
• It must bat for a stronger protection framework and perhaps set up a whistleblower’s office under its direct aegis, so that complainants can bypass in-house committees.
• It may also have to build in-house capacity to investigate a large volume of complaints, so that undue stock price impact can be contained.

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Poor market intelligence impacts food prices (The Hindu)

Mains Paper 3: Economy
Prelims level: Agri-commodities
Mains level: Infrastructural development for agri-commodities

Context:

• After two years of subdued market conditions, the prices of several essential commodities — vegetables, vegetable oils, pulses and sugar, to name a few — are heading northwards.
• Under the lead of palm oil, edible oil rates are markedly up as compared to even six months ago.
• Prices of pulses and sugar are rising too.

Will the rising price trend continue?

• As far as vegetables, pulses and sugar are concerned, weather aberrations have surely played a significant role in damaging crops this year.
• An extended South-West monsoon and untimely rains during the whole of October have resulted in lower crop harvest, deterioration of quality and tightening availability.

Low production:

• The vegetables in general — and onion in particular — have faced the nature’s fury.
• Maharashtra, the country’s largest producer of onion and pigeon pea, has faced harvest losses estimated between 30 and 40 per cent.
• Nationally, in 2019-20, sugarcane output is down to 378 million tonnes from 400 million tonnes, as per Union Agriculture Ministry’s first advance estimate.
• At 8.3 million tonnes, kharif pulses’ harvest is at a four-year low.
• The crop estimate made and released by the government in September will have to be revised down, to take into account losses that followed the October rains.
• In the case of edible oil, we find that palm oil prices have shown a 15-20 per cent spurt in recent weeks.
• India is the world’s largest importer of palm oil, with annual import volume touching 9 million tonnes out of an aggregate import of 15 million tonnes.
• A weak rupee has added to the escalation in landed cost.
• Are high food prices here to stay, or is this just a transient phenomenon?
• The government’s response to crop losses and the resultant price rise has been far from satisfactory.
• During the whole of October and the most of November, the Centre has been a mere witness to the emerging situation.
• This clearly demonstrates the utter lack of research and commercial intelligence on the part of the government.
• The market invariably gives advance signals; but those concerned should know how to read those signals and take appropriate action.
• The ongoing shortage and government’s knee-jerk response is not happening for the first time, nor is it likely to be the last.
• Over the last 20 years that one has tracked, the onion crisis repeats every 2-3 years. The sense of déjà vu is palpable.
• It has carried many editorials in the past on the onion crisis and proffered practical suggestions for minimising the price shocks.
• But successive governments failed to address the core issues and to prevent the repetition of the crisis.
• Whether this was by design or due to indifference is hard to tell.

Next steps:

Invest in infrastructure:

• It is critical for the State governments to invest in storage infrastructure for onions, especially at the large producing centres.
• The onions are not highly perishable, they lend themselves to storing in what are called ‘cool chambers’, which are low-cost but effective underground storage chambers to extend the life of the produce.
• Land available at APMC market yards can be utilised to build the cool chambers. Irradiation can help eliminate infestation, if any, and extend the shelf life of the produce.

Promote value addition:

• The onion market often alternates between glut and shortage, because of which growers are the worst affected.
• In order to stabilise prices, it is necessary to set up processing facilities. The onion is used as an ingredient for a number of products.
• Dehydration facilities will help capture value. Institutional consumers will be the target consumers of the dehydrated onion.

Continue foreign trade:

• Banning export, as it happens in times of shortage, is a bad idea. Any restriction on export of agricultural commodities is anti-grower.
• We must keep both the export and import windows open all the time.
• Through the judicious use of tariffs (customs duty), policymakers will be able to encourage or discourage export-import activity in onion.

Way ahead:

• Reducing the long supply chain that adds cost and provides little value will mitigate the price risk.
• The farmer-producer organisations and consumer cooperatives can work together to reduce the role of middlemen and create a ‘win-win’ situation for growers and consumers alike.
• The policymakers have to be alert and alive to the situation. Often, they shut the stable after the horses have bolted. Delayed intervention does not help the stakeholders.
• To be able to take proactive steps, the government needs to strengthen its research and commercial intelligence capabilities.

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Doping to win: On Russia’s ban from global sporting events (The Hindu)

Mains Paper 2: International
Prelims level: World Anti-Doping Agency
Mains level: Role of World Anti-Doping Agency to observe anti-doping activity

Context:

• The World Anti-Doping Agency (WADA) to ban Russia from global sporting events for a four-year period is arguably the biggest sporting crisis the country has faced till date.
• The anti-doping watchdog’s move will hurt Russia the most at the 2020 Tokyo Olympic Games and the 2022 Beijing Winter Olympics where the nation’s flag, name and anthem will not be allowed.

Move taken by Russia:

• Russia will inevitably approach the Court of Arbitration for Sport with an appeal, for which it has three weeks, but if the sentence is upheld it could bar the nation from participation in several high-profile global sporting events including the 2022 football World Cup in Qatar.
• The saga has its roots in the scandal that erupted on the eve of the 2016 Rio Olympics, when whistle-blower reports nailed Russia for running one of the most sophisticated doping programmes.
• The allegations centred around the active collusion of Russian anti-doping experts, the sports ministry and members of the country’s intelligence service in replacing dope-tainted urine samples with clean ones during the 2014 Winter Olympics in Sochi.
• In September 2018, as part of the resolution of that case, Russia reluctantly agreed to open up its database to corroborate the findings of the reports.
• WADA has now ruled that the country manipulated this very database in order to cover up large-scale violations.

About the latest sanctions:

• There is considerable doubt among anti-doping crusaders whether the measures go far enough.
• Ahead of the Rio games, WADA had recommended that Russia be expelled, but the International Olympic Committee (IOC), under President Thomas Bach, had left the decision to individual sports’ governing bodies, and, subsequently, athletes who were cleared of doping were allowed to compete as neutrals.
• A similar episode had played out during the 2018 PyeongChang Winter Games, where Russia was again banned but individual athletes competed.
• The IOC’s hand may be forced this time around by the sheer magnitude of the findings, but there remains a similar possibility of Russian competitors still participating.
• It may be worth noting that despite Sochi, Russia still played host to marquee events such as the 2015 World Aquatics Championships and the 2018 FIFA World Cup and is again slated to host the swimming event in 2025.

Way forward:

• Both the IOC and WADA have had to straddle the thin line between two powerful but opposing arguments of punishing Russia.
• The country, for its misdemeanours while at the same time preserving natural justice for athletes who are clean.
• But, increasingly it feels like a situation where even honest sportspersons may end up paying the price for the machinations of their corrupt administrators.

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A fundamental right in need of a debate (Mint)

Mains Paper 2 : Polity
Prelims level : Personal Data Protection Bill
Mains level : Key highlights of the bill

Context:

• India’s Supreme Court upheld privacy as a fundamental right in 2017.
• The citizens have awaited legislation to etch the idea into the laws that govern the country. That task is now expected to be achieved by the Personal Data Protection Bill.

Background:

• It was originally drafted by a panel headed by Justice B.N. Srikrishna, a modified version of which was cleared last week by the Union cabinet for enactment.
• Its broad intent is to set down laws on how the use of data on individuals is to be regulated, and it grants us some crucial rights over our data, if not clear ownership of it.
• If the bill gets Parliament’s nod, we will have guidelines on the collection, storage and processing of personal data, and the consent needed for its use, apart from penalties and compensation for violations.
• The bill has a code of conduct and an enforcement model as well.

Key highlights of the bill:

• To the extent that it assures us control of data shared electronically with various websites, apps and the like, the bill’s provisions should serve as a shield against data misuse.
• For too long have data collectors assumed that what they know about individuals is for them to deal with as they so choose.
• It is the finer details of the bill, however, that call for examination.
• The proposed law not only differentiates between data that is non-personal and personal—the latter defined as anything that can identify someone directly or indirectly.
• It also slots personal data as “critical", “sensitive" or “general", with different rules for each kind. Sensitive stuff would include health and financial data, as also sexual orientation, religious affiliation and so on.

Data localisation:

• Any company that has customers in India must store this data within the country, barring exceptions where it could be processed outside the country with explicit consent.
• If the logic of local storage is difficult to grasp, what qualifies as critical data isentirely fuzzy, since this has been left to the government to determine as and when a need arises.
• What we do know is that such data must both be kept and processed within Indian borders. General information, however, could be held in servers and crunched anywhere.
• If this was intended as a concession to foreign tech firms protesting the extra server costs they would have to bear on account of 100% data localisation (as proposed earlier), then it is only a half measure, since many would still need to set up or rent local servers for sensitive data.

Perspective of an internet user:

• The bill’s safeguards appear adequate against privacy threats from private players in particular, the same cannot be said in a general sense.
• If enacted, it would require companies that are deemed “significant data fiduciaries" to verify the identities of its online users, for example, which could cramp the space for free speech afforded by social media apps to those keen on anonymity.
• For the sake of law enforcement, it would also let the government access personal data.

Way ahead:

• For research and policymaking, the state will have the right to people’s non-personal data—which could include “anonymized" personal details.
• These riders might be in our common interest, as claimed, but they also risk turning privacy into a conditional rather than an inalienable right.
• They make too much space for regulatory interpretation of it.
• The bill’s proposed Data Protection Authority is not independent either.
• This, along with other provisions of the bill, could do with a wide debate if this fundamental right is to work as envisioned.

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Delhi fire tragedy (The Hindu)

Mains Paper 2 : Governance
Prelims level : Not much
Mains level : Loopholes in urbanisation

Context:

• The fire that claimed 43 lives in a grimly congested area of the Capital was an industrial accident waiting to happen.
• Sadar Bazar, or for that matter, an increasing number of such areas in and around our cities, are veritable death traps.
• They are testimony to an urbanisation process that has spun out of control, as well as a political economy that encourages vast, largely unregulated industrial activity, in utter violation of labour, safety and environment laws.

Major loopholes highlighted:

• To units such as the one that was gutted in Delhi are generally unregistered, with a range of municipal, labour and tax inspectors, besides local level politicians, typically claiming a ‘cut’ for allowing them to continue.
• Their products are remarkably cheap and service the needs of the poor — be it clothing, plastic household items — but they come at a huge social cost which comes to the fore when a tragedy breaks out every now and then.
• The only way to bring this seedy ecosystem into the mainstream of industrial activity is to reduce the cost of complying with regulation.
• India’s advances in the ‘ease of doing business’ index do not seem to matter for a wide swathe of tiny entrepreneurs, even in the inner city regions of the Capital.
• Industrial clusters for small and even tiny units will reduce their overheads and ensure that their operations are above-board.
• Regulatory reforms for businesses should be accompanied by a relook at how urban spaces should be reordered, at a time when migration to the cities, more so the large ones, is likely to continue, if not intensify.

State migration report:

• According to Economic Survey 2016-17, annual inter-State migration flow has been close to nine million since 2011, against 5-6.5 million between 2001 and 2011.
• For Delhi, Mumbai and more so these days, Hyderabad, Bengaluru and Chennai, which absorb a good share of this exodus from the northern States in particular, there must be a plan in place to deal with this reality.
• A widely dispersed model of urbanisation, such as in Gujarat, Kerala and Tamil Nadu, must be promoted across the northern States, to relieve the existing metros of their burden.
• By developing infrastructure projects in and around the Capital, the Centre is only encouraging further migration into what is already a humongous urban sprawl. \
• Reverse migration out of the metros into smaller towns should be encouraged over the next decade.
• For this, urban spaces need to be reimagined, not just as places to work in but also as centres of education and cultural activity for all classes and communities.
• Civic planners need to place livelihoods and sustainability at the heart of their process.

Conclusion:

• Migration in India represents not merely a search for better opportunities, but rather a desperate quest for earning a livelihood.
• The latter reflects a failure of our growth and development path, which has bypassed rural India.

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Climate treaty at a tipping point (The Hindu)

Mains Paper 3: Environment
Prelims level: Greenhouse gases
Mains level: Divergent resources used

Context:

• The annual Climate Summit, with increasing levels of concentration of greenhouse gases, raises questions on global climate policy.
• The world’s major emitter has rejected multilateralism, premised on burden sharing.
• The European Union’s ambition of ‘net’ zero emissions by 2050 obfuscates needed societal change by ignoring the embedded carbon in imports — a third of their emissions of carbon dioxide.

Policy problem:

• It can both are shifting the burden to India and China.
• The policy problem is that the Climate Treaty considers symptoms (emissions of greenhouse gases), rather than the causes (use of natural resources).
• India, which is responsible for just 3% of cumulative emissions, is the most carbon efficient and sustainable major economy.

Divergent resource use:

• Excessive resource use by a fifth of the world population in a small part of the planet in the West is still responsible for half of global material use and the cause of climate change.
• Asia with half the world’s population is responsible for less than half of material use, and living in harmony with nature.
• Three shifts in natural resource use have taken place in the last 400 years:
• From agriculture to industry;
• Rural to urban; and,
• Livelihood to well-being.

Convergence and stabilization:

• Colonialism and its aftermath of multinational corporations was the driver of the first shift.
• Infrastructure of the second, and
• The societal notions of progress of the third.
• Only the first two global trends show limited convergence and stabilisation. The third diverges sharply between material abundance in the West and societal well-being in India and China.
• Consumption patterns of primary material use for the provision of major services are driven by diverse values that include both global trends transforming human societies.
• At the national-level, resource use is primarily construction material and energy use in buildings, mobility and manufacturing as well as food, which together lead to human well-being.
• More than half of natural resource use and global emissions occurred after 1950, driven by the gradual shift of three-quarters of the global population to cities.

Unprecedented prosperity:

• By 1970, three-quarters of their population had moved to cities, characterised as “unprecedented prosperity”, leading to the trajectory towards climate change.
• China’s acceleration of natural resource use from 2000, also driven by urbanisation, is characterised as “unprecedented growth”.
• Different values and the objective of increasing well-being, rather than wealth, led to China, in 2016, having the same per-capita emissions of carbon dioxide as the West had in 1885. \
• The shares of material use of the different activities in cities in China have remained constant since 1995 as increase in wealth does not modify the structural, economic and social changes, energy and material uses in civilisational states.
• The contribution of the United States to resource use, or cumulative emissions of carbon dioxide, peaked at 40% in 1950, with rapid infrastructure development in Europe, declined to 26% and is likely to remain at this level, reflecting its direction and intensity.
• By 2015, global population had doubled when emissions in China began to stabilise and accounted for 12% of total cumulative emissions. Asia and Africa will peak at per-capita levels that are a third of those of the West.

Different views of prosperity:

• India and China, civilisational states with a population nearly eight times that of the U.S., have re-defined progress.
• In China, electricity consumption per-capita is a third of the European Union (EU) and a sixth of the U.S. Residential energy consumption has increased at a rate less than half the increase in GDP, and corresponds to the increase in urban population, showing limited increase with more disposable household income.
• China also has less than a sixth of the number of cars with respect to population than the EU, while the U.S. has nearly two times that number.
• In China, nearly 40% of the distance travelled is by public transport, which is two times that of the EU.
• While the number of cars in China is projected to double by 2040, half the new cars are expected to be electric vehicles.
• China has the world’s most extensive electric high-speed rail system. In Beijing, three-quarters of public transport buses are already electric.
• Asian household savings as a percent of GDP are two times that of the U.S.

Conclusion:

• By 2040 more than half of global wealth is again going to be in Asia;
• The low carbon social development model adopted by India and China will become the world system, ensuring global sustainability.
• The pattern of natural resource use adopted by western civilisation will more clearly be seen as a short-term anomaly rather than collective transformation or unified evolution of civilisation.
• Alternative strategies led by India and China should replace the ineffective Climate Treaty.

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Moment of reckoning (Indian Express)

Mains Paper 2 : International
Prelims level : Rohingya Crisis
Mains level : Myanmar move to address rohingya issues

Context:

• Aung San Suu Kyi’s decision to appear before the International Court of Justice to defend Myanmar from charges of genocide against Rohingya Muslims is a gambit.
• It is based on her international stature built over two decades of being a prisoner of conscience, detained by the Myanmar junta, and the knowledge that defending her country can only bolster her nationalistic credentials at home and even strengthen her standing vis a vis the all-powerful military.

Role of Suu Kyi

• Suu Kyi, who holds the formal designation of State Counsellor to the government, but is de facto civilian leader of Myanmar, possibly believes that her defending her country’s actions against the Rohingya would carry credibility in the court.
• Her decision to travel to The Hague has triggered an outpouring of support for her among Myanmar’s majority Buddhist communities.
• Myanmar’s anti-Rohingya actions, for which it is being pulled up before the international court, enjoy much domestic support as the Rohingya are not considered “indigenous” to Myanmar, and do not have citizenship.
• It is ironic that Suu Kyi, who had only some years ago, rallied international opinion against the army, will now appear in its support.
• She may have sensed that it might provide her a more equal footing with the country’s most powerful institution, which is also the biggest obstacle to constitutional reform.

Backed by Gambia:

• The most powerful countries seemed powerless in the face of Myanmar’s actions against the Rohingya community, it was a small country like Gambia, backed by the Organisation for Islamic Co-operation, that has taken it to the ICJ on charges of violating the UN convention of prevention of genocide.
• Gambia’s lawsuit is based on a 2018 UN report that accused Myanmar of “genocidal intent”, and its Army of murder, rape and a host of other charges.
• Suu Kyi’s staunch refusal to take the side of the Rohingya has disappointed all those who saw her as an icon of freedom and democracy. Her defence in court is likely to be what it has been elsewhere:
• That military operations against the Rohingya in the Rakhine were actions against terrorism.

Way ahead:

• The outflow of Rohingya refugees from Myanmar has impacted several of its neighbours, particularly Bangladesh, which now hosts the largest Rohingya refugee camp in the world, as well as Thailand and other countries in south east Asia, where thousands from the communuity have fled to escape persecution.
• In India, too, the presence of the Rohingya has added to the polarising debate on the religion of refugees.
• This case at the ICJ is sure to have ramifications beyond the borders of Myanmar.

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China at sea (Indian Express)

Mains Paper 2 : International Relations
Prelims level : Shiyan 1
Mains level : India’s foreign policy

Context:

• Indian Navy “chased out” a Chinese vessel — Shiyan 1— from the Andaman Sea should draw Delhi’s attention to Beijing’s growing maritime scientific capabilities and its ambitious research agenda for distant waters.
• Shiyan 1 is operated by the Chinese Academy of Sciences and is part of Beijing’s growing marine research fleet that now stands at about 50 vessels.

Move taken by Beijing:

• Beijing’s expansive investment in marine scientific research is very much part of its rise as a great maritime power and dovetails into its regional strategies.
• After leveraging marine science diplomacy to good effect in the South China Sea over the last many years, China has begun to extend it to the Indian Ocean.
• Last year, Shiyan-3 invited Pakistan scientists to join a research expedition in the Arabian Sea. Delhi must expect to see more of this in the Indian Ocean littoral.
• But, Beijing insisted that Shiyan 1, “did not conduct any operations in the Indian EEZ (exclusive economic zone) during the whole process, and only sailed through the Indian EEZ on the way to and from the experimental area”.
• The foreign office in Beijing added that throughout the ship’s voyage, the Indian navy aircraft followed it with warnings and its crew also replied in accordance with international practice.

Significance behind the move:

• The issue is not a technical one about the provisions of the law of the sea.
• It is about China’s growing maritime scientific ambition.
• The UN Convention on the Law of the Sea (UNCLOS) favours freedom of marine scientific research. \
• It also lets coastal states decide on granting permission for marine scientific research by other entities in their exclusive economic zones.\

Objectives for the national science fleet:

• To map the sea-bed resources of the world’s oceans. China has internationally sanctioned licences to explore sea-bed mining in a few areas including in the South-western Indian Ocean.
• To develop large ocean databases that facilitate Chinese naval operations by providing accurate maritime domain awareness.
• To use its national fleet for science diplomacy that adds to the Chinese toolkit of building productive maritime and naval cooperation with coastal states across the world.
• It also lets China set the rules for global marine scientific research.
• All major naval powers through history have sought to leverage marine scientific research to broader national objectives, both civilian and military.
• The Indian Navy too has modest marine scientific research capabilities and has deployed them for diplomatic purposes in the Indian Ocean.
• Although, it was a late starter in the maritime domain, China now scores over the US, let alone India, in the scale, intensity, and strategic purpose of its marine scientific research programmes.

Way ahead:

• For Delhi, the Shiyan incident is a useful reminder on the need to invest more in maritime scientific research.
• To strengthening its own national capabilities, Delhi needs to deepen its scientific cooperation with its partners in the maritime domain.
• The annual summit with Japan later this week and the dialogue between the foreign and defence ministers of India and the US in Washington next week offer a good opportunity to put maritime scientific research high on the agenda.

Conclusion:

• India and its partners, including the US, Japan, Australia and France, should develop mechanisms for collaborative research in maritime scientific domain.
• India and its partners must also consider better coordination between their respective maritime science diplomacy initiatives in the region.
• Such partnerships would provide a sound basis for eventual engagement with China on marine scientific research.

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The divisive Citizenship (Amendment) Bill (Indian Express)

Mains Paper 2 : Polity
Prelims level : Citizenship (Amendment) Bill
Mains level : Six Schedule

Context:

• The government introduced the Citizenship (Amendment) Bill (CAB), 2019 in the Lok Sabha despite oppositions.

What does the Bill seek to do?

• It proposes to make it easier for certain categories of migrants to become eligible for Indian citizenship.
• In this revised version of CAB, the Centre has exempted certain areas in the Northeast, where the Bill has been facing protests.
• It exempts the whole of Arunachal Pradesh, Nagaland and Mizoram, and parts of Meghalaya, Assam and Tripura.
• But, it keeps all of Manipur under its ambit.

Why are three states totally exempted?

• The Bill states that nothing in this section shall apply to tribal areas of Assam, Meghalaya, Mizoram or Tripura as included in the Sixth Schedule to the Constitution.
• It also exempts the area covered under ‘The Inter Line’ notified under the Bengal Eastern Frontier Regulation, 1873.
• The Inner Line Permit (ILP) system prevails in Arunachal Pradesh, Nagaland and Mizoram.

How does the ILP system work?

• It is a special permit that citizens from other parts of India require to enter these three states, and obtained by applying online or physically.
• It specifies dates of travel and areas which the ILP holder can travel to.
• When it was introduced in 1873, the objective was to protect the Crown’s own commercial interests by preventing “British subjects” (Indians) from trading within these regions.
• In 1950, the Indian government replaced “British subjects” with “Citizen of India”, to address local concerns about protecting their interests.

What does this exemption mean for beneficiaries under CAB?

• In ILP states, there are already a large number of migrants from other Indian states who live and work there with long-term ILPs.
• Therefore, the question now being asked is whether a person who becomes an Indian citizen through CAB can, or cannot, apply for an ILP and work in such states, just like any other Indian citizen.
• Also, multiple restrictions and regulations exist on entry and stay of outsiders (Indian citizens from outside that state/area) in areas under the Inner Line system or the Sixth Schedule.
• These existing rules are expected to put the same restrictions on someone who has acquired citizenship through CAB.
• However, the exemptions appear to imply that no immigrant non-citizen living in these areas can be regularised as an Indian citizen through CAB.

What is the Sixth Schedule and which areas will CAB exempt?

• The Sixth Schedule of the Constitution is related to special provisions in administration of Assam, Meghalaya, Tripura and Mizoram.
• It provides special powers for Autonomous District Councils (ADCs) in these states.
• ADCs have powers to enact laws in areas under their jurisdiction on a variety of subjects, with the objective of ensuring development of tribal areas and boosting self-governance by tribal communities.
• Mizoram is covered under the ILP regime in any case.
• Among the other 3 states that have areas protected under the Schedule,
• Tribal-majority Meghalaya has 3 ADCs that cover practically the entire state, except for a small part of Shillong city,
• Assam has 3 ADCs and Tripura has 1 ADC.

Why Manipur has been an exception to both these regimes?

• Manipur, like Tripura, was a princely state. Both joined the Indian Union in 1949.
• Only from 1985, the Sixth Schedule was implemented in Tripura’s tribal areas.
• When Tripura was given, the Centre had said that even in Manipur it would be extended shortly but it never turned out to be a reality.
• However, in Manipur the state government had recommended 3 times for the Sixth Schedule but they did not pursue it properly.

What about Manipur’s tribal areas?

• Manipur has two geographically distinct areas.
• The valley, which includes Imphal, constitutes roughly 10% of the geographical area but holds around 60% of the state’s population.
• These belong mostly to the dominant Meitei community.
• The remaining 90% is hill areas, home to the other 40% that include a wide range of tribes, including Nagas and Kukis.
• While granting statehood, was aware that certain problems could come up for tribals and hence introduced Article 371C.

Article 371C:

• It mentions special provisions for Manipur.
• The President may provide for the constitution and functions of a committee of the Legislative Assembly of the State.
• The committee consists of members of that Assembly elected from the Hill Areas of that State for the modifications to be made in the rules of business of the Government and in the rules of procedure of the State Legislative Assembly.
• Any special responsibility of the Governor in order to secure the proper functioning of such committee.
• The executive power of the Union shall extend to the giving of directions to the State as to the administration of the said areas.

Other provisions for Manipur:

• The Manipur (Hill Areas) District Council Act, 1971, passed by Parliament, paved the way for establishment of 6 Autonomous District Councils (ADCs) in Manipur in 1972.
• However, without the Sixth Schedule in place, these Councils have much lower powers in comparison to ADCs under the Sixth Schedule.
• In 2018, the Manipur People Bill, 2018 was passed by the Assembly.
• Said to be awaiting presidential assent, it proposes to several regulations on “outsiders” or “non-Manipuri people” in the state.

What about other states in the Northeast?

• In November 2019, the Meghalaya Cabinet approved amendments to the Meghalaya Residents Safety and Security Act 2016.
• This will lead to laws that require non-resident visitors to register themselves.
• The move came in the backdrop of demands for an ILP-like regime and concerns expressed by civil society and political leaders that people excluded from the NRC in Assam might try to enter Meghalaya.
• In Assam, there have been demands by certain sections for the introduction of an ILP regime.

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On age of consent and age gap, and the implications (Indian Express)

Mains Paper 2 : Polity
Prelims level : POCSO Act, Definition of Child
Mains level : Laws, Institutions and Bodies Constituted For The Vulnerable Sections

Context

• The Madras High Court suggested changes in provisions regarding the age of consent and the age gap in the POCSO Act.

The highlights of the key suggestions made:

• The Madras HC recently acquitted a young accused of sexual assault charges under the Protection of Children from Sexual Offences (POCSO) Act, 2012.

It also made two significant suggestions:

• The age for the definition of a “child” under Section 2(d) of the POCSO Act be taken as 16 rather than 18.
• The POCSO Act account for the difference in age between the offender and the girl involved in consensual sex.
• This means that any consensual sex after the age of 16 or bodily contact or allied acts can be excluded from the purview of POCSO Act and the rigorous provisions therein.
• Such sexual assault, if it is so defined, can be tried under more liberal provision.
• This is to distinguish the cases of teenage relationship after 16 years, from the cases of sexual assault on children below 16 years.
• It also suggested that the Act be amended such that the age gap is not more than 5 years or so in consensual sex where one is aged 16 and above.
• This is to ensure that the vulnerable age of the girl is not taken advantage of by a person who is much older.

Why is the 'age of consent' change welcome?

• The POCSO Act denies consensual sexual agency for young persons falling in the 16 to 18 years age bracket.
• It entails a long 7 to 10 years of rigorous imprisonment for the offender.
• But a lot of experimental consensual sexual acts take place in the age group between 16 and 18.
• However, on coming to parents' knowledge, in most cases, the parents of the girl lodge a complaint that it was non-consensual and the boy is punished.
• Decriminalisation of consensual sex between those aged 16 and 18 will help address such false complaints.
• Physical relationships between such teenagers due to infatuation/innocence could be insulated from rigorous provisions.
• It also acknowledges that consensual sex cannot be criminalised at an age when sexual exploration is common.

What is the contention with the age gap?

• An older man using his power and position to exploit a younger woman could be subjected to criminalisation.
• But just because there is more age gap between the alleged offender and the victim, a consensual act cannot be criminalised.
• Nevertheless, it could prevent a much older person from exploiting a minor and her innocence.
• Age difference not being more than 4-5 years is followed in the UK.
• In the US also there are close-in-age exemptions, also called Romeo and Juliet laws.

Way forward:

• The government will have to take steps to eliminate the unwarranted criminalisation of consensual or romantic sexual relations.
• Any relaxation of stringent punishments entailed in the Act may also be misused.
• So the most critical thing here is to distinguish between the consensual sex between adolescents and abuse or exploitation.
• The onus is on investigating officers to differentiate between the two.\
• But Inspectors and SIs are often driven by their moral compass around sex and sexual acts.
• They should be sensitised and imparted with intelligence and self awareness for nuanced reading and application of the law.

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To beyond Khalistan (Indian Express)

Mains Paper 2 : International Relations
Prelims level : Khalistani extremism’
Mains level : India’s Diaspora

Context:

• India-Canada ties have deteriorated in recent years, especially given the view that the current Justin Trudeau administration is soft on individuals and organisations that support the demand for Khalistan, a separate Sikh homeland.
• Members of Mr. Trudeau’s Cabinet, especially Defence Minister Harjit Singh Sajjan, have been accused of having links with Sikh separatists.
• When Mr. Sajjan visited India in April 2017, Punjab Chief Minister Captain Amarinder Singh refused to meet him for this reason.
• Similarly, Mr. Trudeau received the cold shoulder during his India visit in February 2018.
• When Mr. Singh met Mr. Trudeau, their discussion was on the Khalistan issue, rather than on areas of mutual cooperation.
• Mr. Trudeau drew the ire of the Indian government when a report on terror threats avoided the words ‘Khalistani extremism’.\

Support for a separate homeland:

• There is no doubt that some overseas Sikhs support a separate Sikh homeland, and that there is not much appetite for the same in Punjab.
• However, it is important to not link criticism of India on human rights issues, such as the Sikh pogrom of 1984 and extrajudicial killings in the 1980s and 1990s, with Sikh separatism.
• The Indian media, the government and even politicians in Punjab need to realise that Sikhs based in Canada, the U.K. and the U.S. may have different political views. Similarly, non-violent support for a cause cannot be\ labelled as a militant activity.

Challenges for India and Canada:

• Critics of the Canadian government must also bear in mind that like all relationships, this is a multi-layered one.
• While New Delhi may be uncomfortable with the Canadian government’s approach towards the activities of certain Sikh hard-liners, it is important to bear in mind that for the year 2017, Indian students received well over 25% (over 80,000) of the available study permits.
• In 2017, well over 40% of the 86,022 people who received invitations for permanent residency were Indians. During 2018, this rose by a staggering 13% to 41,000.
• It is important to handle ties with Canada with nuance.
• First, members of the Sikh diaspora and Sikh politicians who are vocal on human rights issues shouldn’t be labelled Khalistani sympathisers.
• Second, it should be remembered that the New Delhi-Ottawa relationship goes well beyond the Khalistan issue.

Conclusion:

• If there is evidence of support for any violent activity, New Delhi and Canada must work together to tackle the problem.
• By focusing only on the Khalistan issue, New Delhi risks alienating the Sikh diaspora.
• India should instead reach out to the Sikh diaspora in a year when Sikhs and all other followers of Guru Nanak will be commemorating his 550th birth anniversary.

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India is in the second space age with one hand tied at the back (The Hindu)

Mains Paper 3: Science and Tech
Prelims level : Second space age
Mains level : Space development

Context:

• Last week, Lloyd’s of London launched a $25 million insurance facility for the private space industry.
• It will cover sub-300kg satellites from pre-launch to in-orbit operations. The insurer estimates the current private space market to be worth $300 billion and expects it to grow to $1 trillion by 2040.
• Neither Lloyd’s nor the City of London are strangers to underwriting exploration.
• Along with their Dutch and later American counterparts, over the past few centuries they helped shape the history and political geography of the modern world.

Background:

• One important lesson from the story of exploration, colonial expansion and empire is that even small legal innovations can have profound consequences.
• The invention of the joint stock company and the ecosystem that arose to support it allowed the Dutch and British East India companies to take massive risks and reap unprecedented rewards for their shareholders and sovereigns.
• A similar business environment on the American continent helped the US grow into what it is today.
• The moral cost of colonialism is unconscionable.
• The inescapable point, though, is that societies that create conditions that allow private entrepreneurs to take big risks often end up as successful, prosperous ones.
• That is a lesson from history that is relevant to the space business today.

Second space age:

• The second space age has already started. If governments were the main players in the first one, private entrepreneurs are main protagonists in the second.
• India has its share of space entrepreneurs, but the regulatory environment remains wedded to the old paradigm of a government-run space programme and the private industry that it nourishes.
• Unlike most other industries dominated by public sector undertakings (PSUs), not only is the Indian Space Research Organisation (Isro) relatively more efficient, competent and competitive, it has also built a technology ecosystem of high-quality suppliers.
• While this allows India to take up exciting scientific missions, such as Chandrayaan, and participate in the heavy-lifting international business of putting satellites in orbit.
• It does little to unleash the energies and resources of the private sector. India finds itself in the second space age with one hand tied behind its back.

India’s defence development:

• At a recent conference, it was felt that both India’s defence and emerging commercial business models require the capability to launch rapidly.
• The defence consideration is to be able to replace crucial space assets quickly should they be disabled by a hostile adversary.
• On the commercial front, the trend is towards constellations of nano- and cube-satellites, some as small as a club sandwich, which operate for a couple of years before de-orbiting and burning out.
• Both scenarios need rockets that are launched at short notice or frequently on a regular basis. While members of the space establishment felt that it would take time for us to achieve this, young entrepreneurs in the room claimed that their business plans could achieve it within a couple of years.
• While they were already designing the rocket, their problem was that the regulatory environment was hard to crack.

Way forward:

• India needs a new space policy one that aims to harness space as a growth sector for the economy, attracts private investments and creates jobs.
• Even as it promotes scientific breakthroughs and helps leapfrog developmental challenges.
• The goal should be to gain a significant share of the $1 trillion global market that Lloyd’s projects just two decades ahead.
• Private investment in New Space is happening and will happen regardless of whether India changes the policy.
• It’s up to us to decide whether we want India to benefit from it or not.

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Banks must stick to their core functions (The Hindu)

Mains Paper 3 : Economy
Prelims level : Non-core areas
Mains level : India’s economic growth and development

Context:

• The recent statement by Finance Minister Nirmala Sitharaman at a private bank’s foundation day event is a marked departure from the usual rhetoric of politicians.
• The Finance Minister said: “Banks should not engage in unnecessary scaling up of business, and, rather lenders must understand their core strength of business and run operations with consistency, stability and with a sense of ownership.”
• She added, “The orthodoxy in banks is better, since it is layered with conventional wisdom.”
• The above statement is a refreshing one because we have allowed the banks to deviate far away from the principles of sound banking.
• Whatever problems the banks are undergoing now are on account of such deviation.

Different entities:

• There is a marked difference between the business of banking and other businesses. Banks operate with others’ money and with a very small capital base.
• Banks’ failure will affect not only the shareholders but also their clients. Moreover, their operations will have contagion effect.
• The ability of banks to return depositors’ money is of paramount importance.
• Year after year, the government is pumping taxpayers’ money to shore up the capital base of public sector banks to maintain their capital adequacy.
• Until three or four decades back, Indian banks’ function was mainly to mobilise community savings for the purpose of lending for productive purposes.
• Banks were not considered as a ‘super market’ of financial products. Banks have been able to mobilise deposits only because of the trust developed in them over the years.
• To have the trust of the people, the banks must adopt sound banking principles like liquidity, safety, profitability, secrecy and customer service.

Into non-core areas:

• When commercial banks ventured into long-term finance after the closure of development finance institutions.
• It led to asset-liability mismatches and affected the liquidity of banks.
• Banks’ lending without adequate tangible security has led to a rise in non-performing assets (NPAs) and affected the safety of funds with banks and the profitability of the lenders as well.
• The diversification of banks into non-banking activities such as insurance and mutual funds has forced them to deploy the productive workforce in these activities, affecting thereby the core function of banking.

Paradigm shift required:

• Security-based lending should be restored to and loans should be sanctioned only with adequate tangible security. Only credit to the weaker sections should be exempt from this criteria.
• Banks’ role should be to focus only on accepting deposits for the purpose of lending. Non-banking activities such as insurance, mutual funds and share broking should be left to dedicated entities other than banks.
• Dedicated development financial institutions should be started again and commercial banks should lend only for the short to medium term.
• Loan waivers should be stopped and using banks’ funds for politically-driven schemes should be eliminated.
• Targets should be fixed more for the quality of operations and not for quantity. When quality is maintained quantity will automatically flow in.

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End-to-end encryption: The heart of data security in today’s digital world (Mint)

Mains Paper 3: Defense and Security
Prelims level : End-to-end encryption
Mains level : Cyber security

Context:

• The advent of the digital world brought us closer and made communication one of the most essential aspects of human life—easier and faster.
• However, communication on different platforms, such as social media and emails, necessitates a certain level of privacy.
• Thus evolved end-to-end encryption, a communication system wherein only communicating users can read messages exchanged between them.

What is an encryption?

• Encryption is the basic building block of data security and is the simplest and most important way to ensure a computer system’s information can’t be stolen and read by someone else.
• This communication system essentially prevents eavesdroppers, including your telecom service provider, internet provider, and the provider of the communication service under consideration, from accessing and reading your messages.

Reasons behind make encryption possible:

• Such prevention is possible because plain text messages are encrypted in the form of cipher text and then again decrypted when the recipient is expected to receive it.
• In other words, in the computing world, encryption is the conversion of data from a readable format into an encoded format that can only be read or processed after it’s been decrypted.

Why do we need end-to-end encryption?

• In today’s social media-dominated world wherein most of the communication happens online, end-to-end encryption prevents your private information from being read or secretly modified, other than by the true sender or recipient(s).
• After all, whether we are talking about family conversations, exchange of authentication information, businesses handling sensitive information, everyone should expect and demand privacy when communicating online.
• The need for secure communication is even more important given how personal information can be easily used to target audience-specific ads, manipulate people’s political and religious standpoints, keeping a tab on important societal figures, spreading rumours in the form of fake news, and even causing terrorist attacks worldwide.

How does end-to-end encryption work?

• As the basic building block of data security, end-to-end encryption functions using encryption algorithms and “keys."
• When information is sent, it’s encrypted using an algorithm and can only be decoded by using the appropriate key.
• A key could be stored on the receiving system or it could be transmitted along with the encrypted data.
• Therefore, to approach the issue of data security, we must consider the ways a message chain or voice communication can get exposed to a third party. The options are few.
• Any message, regardless of its nature (text, video, photo, or voice) is recorded on local storage volumes on the sender’s and recipient’s systems;
• It has transferred via wired or wireless networks; and, thirdly, is processed by the service’s server (well, not obligatory).
• To some extent, control the access to the messaging history in the first case, the rest of the path the message travels is completely out of control.
• While end-to-end encryption sits at the heart of data security and allows users to feel safe about their exchanged information, it is also not 100% secure.
• At the beginning of the encryption era, it was only used by governments and major firms as they had the great responsibility of keeping huge databases private.

Why encryption is so significant?

• As most of the world’s population is online today and is exchanging data across the globe, it has become necessary for various networks to protect user passwords, payment information, addresses, other personal information including mobile data and any message sent across these networks.
• Hence, encryption from being a strong security measure at the beginning has now become a basic security measure for companies and networks.
• Every app that we use in today’s time can be exploited by cybercriminals in some way or the other and as consumers, our data privacy is left in our own hands.

Way ahead:

• As consumers, we must be well aware of all the alternative apps that we can use and current news about them in terms of threats and breaches.
• It’s looking at how the app company responds to such a breach is also important to know if we can trust them for our data in future.
• Companies too need to focus on advanced technologies like post-quantum cryptography, which offers a promising alternative to the existing systems that may eventually become obsolete.
• With support from other corporations, these new technologies will bring about the evolution, and not the end, of encryption.

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From Bougainville referendum to Nithyananda’s Kailaasa, How is a new country formed? (Indian Express)

Mains Paper 2: International
Prelims level : Bougainville
Mains level : Formation of new country

Context:

• Bougainville, an island in the Pacific, is holding a referendum to decide if it wants to remain a part of Papua New Guinea or become an independent country.
• Nithyananda, India’s fugitive godman, has reportedly founded his own country somewhere in the Pacific.
• Across the world, various territories are agitating for independence — Catalonia in Spain, Kurdistan in Iraq, Tibet in China. New countries are suddenly in high demand.

How does a territory become a new country?

• There is no straightforward rule. Beyond a few set requirements, a region’s quest for nationhood mainly depends on how many countries and international organisations it manages to convince to recognise it as a country.
• The biggest sanction of nationhood is the United Nations recognising a territory as a country.

Who can declare itself a country?

• There is no law barring regions from declaring independence. In Jharkhand in 2017-18, as part of the Pathalgadi movement, stone plaques had come up outside villages, declaring the gram sabha as the only sovereign authority.
• Somaliland in Somalia has been calling itself a country since 1991, but no one else recognises it. Kosovo in Serbia declared independence in 2008, and only a few other countries recognise it.

What criteria must a nation-hopeful meet?

• Broadly, four, as decided in 1933’s Montevideo Convention. A country-hopeful must have a defined territory, people, government, and the ability to form relationships with other countries.
• A country’s “people” are defined as a significantly large population sharing a belief in their nationality.
• Factors also kept in mind are if a majority has clearly expressed the desire to break away from the parent country, and if the minority communities’ rights will be safeguarded.

Self-determination versus territorial integrity

• In June 1945, the right of “self-determination” was included in the UN charter. This means that a population has the right to decide how and by whom it wants to be governed.
• However, another of the oldest, widely accepted international rules is that of countries respecting each other’s territorial integrity.
• While a population has the right to break off from the parent country, quick recognition of their claim would mean other nations are agreeing to the carving up of one country.
• The right to self-determination was introduced when a few colonial powers were dominating most countries, and questions of right were relatively easier to settle.
• Today, the issue becomes thorny and shapes up either as granting of greater autonomy to certain regions within a country, prolonged armed conflicts, or both.
• Thus, though Taiwan says it is a country, other nations defer to China’s feelings about it. Last year, Air India changed the name of Taiwan to Chinese Taipei on its website when China “raised concerns”.\

Why UN recognition matters?

• UN recognition means a new country has access to the World Bank, the IMF, etc. Its currency is recognised, which allows it to trade.
• Often, UN member states recognise a country, but not the UN as a body. This puts a country in the grey area with respect to protection against parent country’s aggression, and international trade.
• By and large, so far, a country swinging the UN’s opinion in its favour has depended on how many of the big powers back it, and how much international clout its parent country wields at that time.
• East Timor, then a Portuguese colony, was invaded by Indonesia in the 1960s.
• But the western powers then needed Indonesia as an ally against Russia, and East Timor’s woes didn’t get much attention.
• By the 1990s, power alignments had changed, and East Timor managed to hold a referendum by 1999 and declare independence in 2002.

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Retributive justice: On Hyderabad vet rape and murder (Indian Express)

Mains Paper 1: Society
Prelims level : Not much
Mains level : Effect of societal pressure from Hyderabad incident

Context:

• The heinous rape and murder of a veterinarian in Hyderabad in late November shook the collective conscience of India.
• It has been resulted in an outcry for justice for the victim and outrage over the persisting lack of safety for women in public spaces.

Effect of societal pressure:

• The societal pressure for justice invariably weighs upon legal institutions, as the police are required to find the culprits with alacrity and the judiciary to complete the legal process without undue delay.
• But these institutions must uphold the rule of law and procedure even in such circumstances.
• The killing of the four accused of the rape and murder of the veterinary doctor by the Cyberabad police raises disturbing questions.
• The police claim that two of the accused snatched their weapons and fired at them when the four had been taken to the crime scene to reconstruct the sequence of events late after midnight, and that they killed them in self-defence.
• The claim stretches credulity. The National Human Rights Commission has deputed a fact-finding team to Hyderabad to probe the incident.

Role of judiciary:

• The guidelines set by the Supreme Court to deal with such events, including the need for an independent investigation, must be strictly observed to get to the bottom of this sordid episode.
• The jubilation seen on social media platforms and on the streets over the killings by the police stems from the public anger and anguish over the burgeoning crimes against women.
• There is a perception that the legal institutions are ill-equipped to deal with such crimes and to bring the perpetrators to justice.
• It much more needs to done in terms of registration and charge-sheeting of sexual crimes by police and addressing the pendency in court of such cases, there has been greater awareness and improvement in both the policing and judicial process following the horrific bus gang-rape in December 2012 in New Delhi.

Role performed by the government:

• The Telangana government had, in this case as well, issued orders for setting up a fast-track court to try the four accused and if the successful prosecution in the Delhi case had been applied as a precedent, this should have brought closure to the case in a time-bound manner.
• Existing laws on sexual crimes and punishment need better application, but a recourse to brutal retribution as suggested unwisely by many is no solution.

Way forward:

• The political sanction of “encounter killings” to deliver swift retribution would only be a disincentive for the police to follow due process and may even deter them from pursuing the course of justice.
• Far from ensuring justice to the victims, bending the law in such cases would only undermine people’s faith in the criminal justice system.

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The Smart Cities Mission needs to be efficient, socially inclusive (The Hindu)

Mains Paper 3: Economy
Prelims level : Smart City mission
Mains level : Reasons lacking behind not progressing the Smart City mission

Context:

• In 2014, the NDA government had announced that it will set up 100 smart cities across the country.
• The objective of the Mission was to promote cities that provide core infrastructure and give a decent quality of life to its citizens, and a clean and sustainable environment with the application of technology.

About Smart City mission:

• 81 per cent of the projects proposed under the Smart City Mission have been tendered out, while 25 per cent of the projects stand completed.
• A total of 5,151 projects worth ₹2,05,018 crore have been proposed by cities participating in the Smart Cities Mission.
• Due to the lack of coordination between various agencies implementing the project and lopsided priorities when it comes to investing the funds allocated under the programme.

Reasons behind the progress lacking behind:

• Globally, a smart city is built on a communication network that gathers data from smart devices and sensors embedded in roadways, power grids, buildings and other assets to create efficient services.
• But cities selected under India’s Smart Cities Mission are busy focussing on basic infrastructure.
• The Mission cities are putting their highest share of investment (16.60 per cent) into urban transport development.
• Despite cities facing a solid-waste management crisis, only 2.4 per cent of the funds have been allocated towards this issue.
• Social sectors and storm-water drainage are also low on priority. Lack of coordination between various government agencies and project execution is another area of concern. In some areas, Smart City Missions have created a parallel mechanism of governance instead of strengthening local governing bodies.
• There is also little attempt being made to create awareness among citizens about the need for such cities.
• Some of these smart cities are being built from the ground up, on land currently owned by villagers who complain that the project is being thrust on them without considering their requirements.
• A World Economic Forum paper recently pointed out that people’s participation in the Smart City Mission is limited to digital literates, potentially skewing opinions.

Way ahead:

• The Centre needs to urgently initiate systemic reforms if it wants to make India’s cities future-ready.
• By 2050, about 70 per cent of the global population will be living in cities, and India is no exception. India will need about 500 new cities to accommodate the influx into its urban regions.

Conclusion:

• The Smart City Mission has raised great expectations. But commitment from the State governments and governance reform at all levels of government is required to make it a success.
• Institutional reform, as well as an inclusive notion of city spaces, is required to take the Smart City project ahead. Cities need to be not just technologically smart, but liveable for all.

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Climate warnings: On unmet emission goals (The Hindu)

Mains Paper 3: Environment
Prelims level : Intergovernmental Panel on Climate Change
Mains level : Highlights the new report by IPCC

Context:

• Two important reports of the Intergovernmental Panel on Climate Change (IPCC), on the impact of higher global temperatures on land, oceans and the cryosphere, lend further urgency to the task before countries now meeting in Madrid for the UN conference.
• The member-nations of the UN Framework Convention on Climate Change have been trying to finalise measures under Article 6 of the Paris Agreement to commodify carbon emissions cuts, and to make it financially attractive to reduce emissions.

Major findings:

• The IPCC scientists research helps the international community decide on actions to reduce greenhouse gas emissions.
• It has been threat the most optimistic scenarios, human health, livelihoods, biodiversity and food systems face a serious threat from climate change.
• In the case of oceans and frozen areas on land, accelerated rates of loss of ice, particularly in Greenland.
• The Arctic and the Antarctic, will produce a destructive rise in sea levels; increases in tropical cyclone winds, rainfall and extreme waves, combined with relative sea level rise, will exacerbate catastrophic sea level events.
• All this will deal a blow also to the health of fish stocks.
• The countries with a long coastline, including India, is that local sea level anomalies that occurred once in a century may become annual events, due to the projected global mean sea level rise over the 21st century.
• This is an alarming scenario for the 680 million residents of low-lying coastal areas, whose population may go up to one billion by 2050, and for those living in small islands.

Why the new assessment is significant?

• The new IPCC assessment underscores the need for unprecedented and urgent action in all countries that have significant greenhouse gas emissions.
• It strengthens the case for industrialised nations to provide liberal, transparent funding to developing countries under the Paris Agreement, reinforcing the principle of Common But Differentiated Responsibilities and Respective Capabilities, and recognising that rich countries reduced the carbon space available to the poor.
• The developed world will be focusing in Madrid on creating a global system of accounting for emissions reductions, introducing credible carbon markets, and making some of the gains from these markets available to developing nations to invest in green energy.
• The scientists have a high degree of certainty on losses that will arise from climate change, there must be steady progress on addressing damage.

Way forward:

• The existing Nationally Determined Contributions filed under the Paris Agreement fall short and need augmenting.
• There is a yawning gap between planned emissions cuts, and what needs to be done by 2030 to contain global temperature rise at 1.5°C.

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Performing MSMEs to grow and create jobs (Indian Express)

Mains Paper 3: Economy
Prelims level: Not much
Mains level: Boosting MSMEs

Context

• Getting MSMEs employ 92 per cent of the workforce, to grow more rapidly should be one of the pillars of any strategy for job creation.
• Compliance with the over 40 labour laws becomes mandatory once the number of workers employed by a firm crosses the prescribed threshold.
• Different thresholds under different laws:
• Small firms find the costs of compliance too high and so often prefer to remain small or open a few more units in other names.
• They lose the gains that flow from the economies of scale.
• It is with scale that technological modernisation, marketing and advertising, which are necessary for growth, make commercial sense.
• Converting the over 40 labour laws into the proposed four codes is an overdue reform.
• Putting in place a social safety net would make the provision of labour market flexibility easier in the new codes.
• Such flexibility reduces the risk perception in expanding the workforce.

Regulatory burden

• Regulation of enterprises for human safety, health and the environment and ensuring compliance with prescribed standards is naturally essential. But the regulatory burden for enterprises is still too high.
• Overlapping and redundant regulatory requirements need to be scrapped. Detailed work and micro decisions need to be taken across regulatory regimes in the Centre as well as the States. To illustrate, a good question to ask would be why any permission, once granted, should need renewal.
• Government inspections for compliance with standards could also be gradually replaced by a credible system of third-party certification.
• This would go a long way in reducing the transaction costs of compliance, and at the same time lead to better compliance.
• A good beginning has been made with third-party boiler inspection and certification. This approach can easily be extended to all certification.
• As with chartered accountancy firms, an effective system of oversight over certifying firms can also be put in place.
• The key is to improve a firm’s perception of the costs of compliance and their associated risks, which need to be brought down to the level of competitive locations overseas.

Labour productivity

• Progress is also needed in lowering the factor costs of production for MSMEs.
• Wages in India are low; they need to rise for poverty to decline.
• But when it comes to wage costs per unit of production, MSMEs lose on account of the low productivity of their labour.
• Labour productivity in the modern organised sector with large plants is not an issue, as these firms train their workers and supervisors.
• MSMEs are, by and large, not able to provide adequate training.

Skill upgradation is needed:

• The National Skill Mission should accord as much, if not more, priority to training and skill upgradation of the existing workforce vis-a-vis imparting skills to the young people who are entering the workforce.
• Skill upgradation would need to be designed and implemented creatively in a way that factors in the natural inclination of the employer and worker, respectively, to not lose any production, or wages.
• The programme would need to be designed for industry segments and implemented across industrial clusters after testing and tinkering it for one unit.
• Spending public money for such skill upgradation would be well worth it.
• It would increase competitiveness, facilitate growth and create more jobs.
• Success of existing enterprises is the key to getting new entrants in that area of that industry.

Industrial land usage

• Land for MSMEs is a major constraint. It needs to be recalled that, across the world, structural transformation through industrialisation has taken place in cities.
• Mumbai and Kolkata grew into major commercial and industrial cities over a period of 100 years prior to Independence, with flexible and pragmatic land-use regulations to facilitate growth.
• Rigidities have gradually crept into the system to such an extent that recently, in Delhi, the closure of hundreds of gyms that had come up in residential areas to cater to demand has been ordered.
• Many micro enterprises emerge in non-conforming areas and then try to stay in the non-formal economy.
• Growing into a small and then medium enterprise is difficult for them. Land is not available and prices are too high.
• A ‘plug and play’ system is being talked about but needs to be made a reality soon across the country.

Way ahead

• There is need for a functional system which can quickly identify this need and provide developed land in new industrial parks, with the development done by a state agency directly, or in a PPP mode.
• Further, there are a large number of usable plots lying idle for years in industrial parks across the country, where units have become sick and gone into bankruptcy.
• An efficient, quick system for releasing these lands for industrial use by new units should be put in place by the Central government.
• Technological modernisation and competitiveness are essential not only for growth but also for survival.
• PPPs for such modernisation are worth attempting; this can be done by getting the best technological capability for an industrial segment and taking up one cluster for a turnaround.
• Bulk procurement of capital goods and leasing them may be easier than trying to get individual enterprises to make major investments.
• A much lower GST rate for such leasing would be amply justified.

Conclusion

• MSMEs can be made to achieve their full potential and create an increasing number of jobs.
• But this needs focussed attention with policy changes, additional State interventions and more public funding.

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No cut in time (Indian Express)

Mains Paper 3: Economy
Prelims level: Monetary Policy Committee
Mains level: Status quo by MPC

Context:

• The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) voted unanimously in favour of leaving the policy rate unchanged.
• Considering that the economic slowdown has been more severe than expected, and that till the last policy, the overriding concern was to arrest it, this decision is not only surprising, but also suggests a certain incoherence of approach.
• Though the MPC has noted that the policy space exists for future action, with growth unlikely to pick up meaningfully in the near term, and considering the lags in transmission, rather than adopt a wait and watch approach, it should have stayed with its earlier stance of reducing policy rates further.

Several reasons for maintaining status quo:

• The explicit concern was the recent spurt in inflation and inflation expectations. But, the current rise in inflation, led primarily by high food prices, is likely to be transitory.
• According to the RBI’s own projections, it is expected to decline to 3.8-4 per cent in the first half of 2020-21.
• Even the rise in inflation expectations is driven by food inflation and is likely to abate once it moderates.
• And while there is also concern over a rise in core inflation, owing to higher telecom tariffs, this is also likely to be a one-off event.
• In arguing that the pause is due to concerns over inflation, the MPC has indicated that it is interpreting its inflation targeting mandate too narrowly.
• Rather than using the flexibility provided by the 4 plus/minus 2 per cent band, it has chosen to target a fixed rate.

Way forward:

• The other, perhaps more pressing, concern before the MPC is the Centre’s fiscal position.
• The worry that higher government spending, financed by borrowings, could push up inflation and lead to a hardening of rates could have played a major part in this decision.
• It is probable that the MPC wants to utilise the policy space available to it once more clarity over the government’s borrowing programme emerges.
• Though the governor has repeatedly said that the MPC is waiting for the full impact of the previous rate cuts to play out, and that the timing of cuts is important, given the delays in transmission, a more prudent approach would have been to front load the rate cuts.

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